Spotify starts paying creators to compete with YouTube

Spotify is fully committed to video.

The company will soon start paying creators based on how much engagement their videos receive from paying subscribers. Automatic ad breaks in videos will also be disabled for paid Spotify subscribers to increase consumption. Both changes will come into effect on January 2, 2025 in the US, UK, Australia and Canada.

Paying creators directly based on their engagement puts Spotify on a collision course with YouTube, which also relies on podcasts and already pays its creators billions a year in shared advertising revenue. “We can offer your audience an experience that is superior to any other platform,” CEO Daniel Ek said on stage at a Spotify creator event in Los Angeles on Wednesday.

Since Spotify made video podcasts generally available in 2022, usage of the format has skyrocketed, with the number of video creators on the platform more than doubling each year. There are now over 300,000 video podcasts on Spotify, up from 250,000 at the end of June, and “video consumption hours have grown faster year-over-year than audio-only consumption hours,” said company spokesman Gray Munford.

Creators can access their payout details through a hub called Spotify for Creators. This also allows them to determine whether they are eligible for video payments and provides advanced analytics and the ability to upload short, vertical video clips.

However, there is uncertainty about how much Spotify wants to pay creators. The company doesn't explain exactly how it calculates video payouts, although Munford said creators can see their breakdowns in the Spotify for Creators hub.